China will limit the number of domestic companies able to export auto vehicles next year, an official from the Ministry of Commerce said.

Zhang Ji, deputy director of the mechanics, electronics, and hi-tech industry department under the China's Ministry of Commerce, said the ministry is drafting a new system to rectify automobile export orders. It will come into effect in January.

Under the system, the government will limit the number of companies that can export vehicles through the use of export licences, he told an auto industry forum in Beijing.

The system is aimed at protecting firms from vicious competition.

It is expected that only companies with a large enough export volume will be awarded export licences under the new ruling, as smaller companies usually use price-cutting strategies to enter foreign markets, which hurts the nation's interest.

China's automobile output makes up 10 per cent of the world's total while its export volume accounts for less than 1 per cent of the world's total.

To support local car exporters, he said his department is working on an information platform of overseas auto markets. It is collecting material via the ministry's 100 economic and commercial offices worldwide.

Zhuang Yuxian, manager of Dongfeng Commercial Vehicle Company's overseas market department, said the company was working out strategies for key markets.

China's auto exports climbed by more than 120 per cent last year to overtake annual imports for the first time.

Exports of Chinese-made vehicles were largely trucks accounting for over three-quarters of the total with exports of sedans and cheap small cars also climbing.

China-based companies currently export vehicles mainly to developing nations in Africa, the Middle East and Southeast Asia, but also plan to export to the more competitive United States and European markets.

Zhang also said that a strategic alliance would be established between the China Ocean Shipping Corp, the China Export and Credit Insurance Corp and major automobile exporters to promote auto exports.

Export credit insurance companies should play a larger role in export promotion and increase credit support to car producers, he added.